Juncker (r) Or Federalising the Debt

June 29, 2014

jean-claude juncker“Mr Juncker is seen as an ‘arch federalist’ by the Government because of his record of wanting more power for Brussels over national Parliaments” Jean-Claude Juncker is no Santa Clause.

“Mr Cameron added: ‘There are times when it’s very important that you stick to your principles … even if the odds are heavily stacked against you rather than go along with something that you believe is profoundly wrong.’

He said the recent European elections had shown that there was ‘huge disquiet about the way the European Union works’. ”

Cameron is campaigning for reform of Europe and the election of Juncker will be viewed as a step back for reform and a step forward for the status quo of austerity for taxpayers and no austerity for lenders.

…”

Support for the EU is wafer thin in the UK and the Tories have pledged an IN/OUT referendum in 2017 if the Tories remain in power.(1)

At the heart of this dispute in Europe is fears over growing centralisation. However, it is ironic that growing centralisation does not include the centralisation of bailout debt of peripheral debtor nations such as Ireland.

Meanwhile former Luxembourg Prime Minister Jean-Claude Juncker will become next president of the European Commission following  European Council vote 26:2 on June 27 with UK and Hungary voting against.

The question is will David Cameron now lead a eurosceptic campaign for Britain to leave the EU. Will he regard his reform agenda as dead?

The vote comes in the wake of the routing of pro European parties in the recent European elections May 26/27.

http://www.economist.com/blogs/charlemagne/2014/05/european-elections-0

European parliament elections saw the rise of  the neo-Nazi Golden Dawn party in Greece now set to enter the European Parliament. On the far-left, meanwhile, the anti-troika Syriza party leads the ballot. Its clear people voted on the basis not of extreme ideological far left or far right on a racist agenda, but simply on for or against the Europe project.

Many of those who do not hold the extreme views of extreme left or right voted for such parties on the basis no mainstream  parties articulated their anti EU views.

In France Marine Le Pen, trumped  both the centre-right UMP party and the Socialist Party of François Hollande. The National Front won about a third of the seats allocated to France. “One half of the Franco-German motor of EU integration thus appears to have gone into reverse, with unforeseeable consequences for the whole European project.” However mainstream parties still control up to 2/3 of seats in the EP.

“In Britain, always more sceptical of the European project, Mr Farage’s UKIP seems to have beaten the traditional parties, with the opposition Labour party coming second and the Conservative party of the prime minister, David Cameron, coming third. “I don’t want Britain to leave the EU. I want Europe to leave the EU,” declared Mr Farage.”

Cameron for the Tories at home has let some of the air out of the tyres of the eurosceptic wing of the Tory party and the rise of Farage UKIP.

It will be interesting to observe if Cameron transmogrifies from a position out to ‘reform Europe’ to outright eurosceptic supporting UK unilateral withdrawal.

In Ireland there was no support for the Cameron anti Federalist position in spite of Enda Kenny’s continuing failure to negotiate a debt write-down. Kenny,  a golden boy of the troika is ‘glowing testimony’ to the policies of the soldiers of austerity, he hopes to obtain a commissionership or two for Ireland out of his support for Juncker.

Kenny lost opportunity to play the debt card and make his support for Juncker contingent on a reworking of Ireland’s odious debt profile with Irish people saddled with approx €40bn out of the troika’s €67bn losses that ought to have been shared by external banks. Clearly FG and Labour policy is to be poodle for Europe and the banking financial industry.

Meanwhile John Bruton chairman of IFSC, a former Taoiseach and Fine Gael hack, has espoused the view election to presidency of the European Commission should be by vote of the people directly not merely by members of the European parliament.

Ironically, Juncker’s EPP in its electoral manifesto for 2009

http://en.wikipedia.org/wiki/European_People’s_Party

also called for ” direct election for the President of the European Commission “. EPP also supports, ” Increasing transparency and surveillance on financial markets. ”

Kenny’s other political initiative, the banking inquiry, would appear to be dissolving before our eyes before it even gets to take place.

Cabinet confidentiality may prevent certain records surfacing if they exist. Restrictions surrounding the inquiry limiting it to a showcase trial around the guarantee already limit investigation of the poor management of Ireland’s bailout deal led by representatives of the central bank/dept for Finance and political representatives.

The curious case of Brian Lenihan’s repeated visits to the Dail with the bill for the banks leaping from €3bn to €30bn + is major cause for investigation as to who misled who with the bill passed to Irish taxpayers, a story that demands to be told.

Reform in Europe has been put on the back-burner. Juncker’s backing by Merkel will further consolidate a federalist Europe with growing powers of centralisation and growing control of the European parliament by Germany.

As austerity and lack of growth continues to haunt the EMU, is it now time for Ireland and the UK to consider leaving the EU? Its long past time for Ireland to adopt a strong position in renegotiating its debt profile.

To do so, do we need to leave the euro and join those countries outside the euro such as Switzerland and the UK ?

Currently the following countries do not use the euro.

United Kingdom
Bulgaria
Croatia
Czech Republic
Denmark
Hungary
Lithuania
Poland
Romania
Sweden

Ireland outside the euro could return to its own currency, the punt,  using the euro as a base.

Deflation in Europe is about to make our debt profile worse. Calls in Europe for more investment to stimulate jobs come against the backdrop of a growing austerity that puts more brake on growth.

There is less and less money to go round. Devaluation would help restore our national finances. An open, flexible country with a large dependence on exports, could offset any disadvantages and quickly restore order to Ireland’s finances. Day by day our prospects in Europe diminish.

Whatever there is looted from starving the public services of funding in education and health gets exported back to large banks in Germany, France and US by way of €8bn in interest payments on our ‘bailout’ debt. An alliance with UK under a commonwealth free trade agreement the Switzerland way could yield an excellent alternative to our current debacle.

http://ec.europa.eu/trade/policy/countries-and-regions/countries/switzerland/

“The cornerstone of EU-Swiss relations is the Free Trade Agreement of 1972.

As a consequence of the rejection of the EEAmembership in 1992, Switzerland and the EU agreed on a package of seven sectoral agreements signed in 1999 (known in Switzerland as “Bilaterals I”). These include: free movement of persons, technical trade barriers, public procurement, agriculture and air and land transport. In addition, a scientific research agreement fully associated Switzerland into the EU’s framework research programmes.

A further set of sectoral agreements was signed in 2004 (known as “Bilaterals II”), covering, inter alia, Switzerland’s participation in Schengen and Dublin, and agreements on taxation of savings, processed agricultural products, statistics, combating fraud, participation in the EU Media Programme, the Environment Agency, and Swiss financial contributions to economic and social cohesion in the new EU Member States.

In 2010 an agreement was signed on Swiss participation in EU education, professional training and youth programmes.

In overall, around 100 bilateral agreements currently exist between the EU and Switzerland.”

Ireland could well take a leaf from the Swiss book. With a similar bilateral trade agreement with the UK, there is another way to the austerity path.

With lack of inflation, anchored to the euro, our situation worsens. However, with results from recent local elections it appears most now reject the FG/LB view that we are living in a paradise with 70,000 new jobs with the tide turning.

Many experience such a fool’s paradise differently, especially those on hospital trolleys.

End.

 

1. Read more: http://www.dailymail.co.uk/news/article-2671985/Angry-Cameron-warns-European-leaders-consequences-Cognac-breakfast-Brussels-fixer-Jean-Claude-Juncker-given-EUs-job.html#ixzz361HE77UF

2. http://en.wikipedia.org/wiki/Croatia_and_the_euro

3. http://www.economicshelp.org/blog/1299/economics/advantages-and-disadvantages-of-devaluation/

 

 

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